The Average Cost of Tuition and Room and Board for a Small

question 37

Multiple Choice

The average cost of tuition and room and board for a small private liberal arts college is reported to be $8,500 per term,but a financial administrator believes that the average cost is higher. A study conducted using 350 small liberal arts colleges showed that the average cost per term is $8,745. The population standard deviation is $1,200. Let α = 0.05. What are the null and alternative hypotheses for this study?

• A)H₀: µ ≤ $9,000; H₁: µ > $9,000
• B)H₀: µ ≥ $9,000; H₁: µ < $9,000
• C)H₀: µ ≤ $8,500; H₁: µ > $8,500
• D)H₀: µ ≥ $8,500; H₁: µ < $8,500